ACB plans to rebuy its shares. – Photo VTC

HA NOI  (Biz Hub) — Asia Commercial Bank (ACB) has announced its plan to repurchase 17.5 million of its own shares, thereby attracting the attention of investors.

The noteworthy thing is that the plan was announced amid efforts to curb non-performing loans. It helped ACB shares retrieve a high of VND16,000 in spite of overall stagnant transactions in banking stocks.

The bank will buy back the shares from December 2 to December 31 at VND12,000 to VND19,000 (US$0.50 to $0.80) each and will therefore have to spend an estimated VND210 billion to VND332 billion ($9.9 million to $15.6 million).

It is common for companies to buy back their shares to prevent the price from falling too quickly and ACB is no exception, with its share price reaching its highest level in seven months.

Meanwhile, ACB's undistributed profit, the financial source for its planned buyback, was estimated to be a mere VND209 billion ($9.8 million).

The bank also aims to buy 523,000 treasury stocks and is currently holding nearly 28 million treasury stocks.

Last April, ACB registered to buy 33.8 million shares but succeeded in buying only 35 per cent of these shares because of price volatility, the bank said.

ACB's management board explained its step as a potential investment. "We will sell the shares when the price reaches our expectations," a representative said.

ACB's profit for the first nine months of 2014 hit VND3.4 trillion ($160.3 million), a 5.9-per cent year-on-year decrease.

The cost of risk provisions increased to VND664.4 billion ($31.3 million), surging by nearly 95 per cent, as non-performing loans rose to 3.07 per cent.

Apart from ACB, Eximbank likewise announced its plan to buy 62 million treasury stocks late last year, when changes in key bank positions and speculations on an impending merger drove the price down. However, the HCM City-based bank has managed to buy only six million treasury stocks so far. — VNS